When you first install and use Windows, you are prompted to set up the accounts for your PC. You can add names for each person using the computer (and then later go back and modify the accounts), or you can add the accounts later, as described here.
The purpose of accounts is to let each person customize how Windows works. The user accounts also save favorite Web sites, create My Documents folders, and more. You can customize Windows and then create a new account. In this case, the new account will use these settings. Otherwise, you can create a new account, and any changes you make to certain settings (the Favorites List, display, mouse, and so on) are saved with that particular account.